Implications of the Supreme Court's ACA Medicaid Decision

In the typical case, states are expected to act like independent sovereigns and reject federal funding conditions they do not like. In National Federation of Independent Business v. Sebelius (NFIB), however, the Supreme Court found that Congress unduly coerced states when it enacted the Affordable Care Act's Medicaid expansion provision. This article provides an overview to NFIB and discusses its implications. Focusing on Chief Justice Roberts' plurality opinion, the article explains that undue coercion may occur when the following four elements come together: (1) Congress enacts a new spending program; (2) Congress seeks to induce state participation in the new program by threatening to terminate all federal funding to an existing program; (3) the federal funding to the existing program is significant; and (4) the requirements of the new program are not related to the old program and, thus, could not have been anticipated by the state.